Are you a foreign entity exporting goods from South Africa?

Or are you a tourist on holiday in South Africa? Did you buy gifts for those back home or mementos of the trip for yourself?

You might be a non-resident of South Africa but have ordered products from the country to be delivered to you by courier or freight forwarder.

Possibly you are a foreign diplomat in South Africa, now coming to the end of your term and preparing to move back home.

Whichever scenario fits, we have good news that you might have missed: you can claim back the Value Added Tax (VAT) that was levied on the products you bought and plan to export or take home with you. In this article, we’ll tell you how.

South Africa has a VAT refund mechanism. This is where you, as a qualifying purchaser, are refunded the amount of VAT (15%) that was charged when you purchased goods in South Africa, whether for private use or for export. The mechanism applies to the purchase of goods only, not to the purchase of services.

 

Who may claim the VAT refund?

The qualifying purchaser or the purchaser’s cartage contractor (freight forwarder/courier) is able to make the VAT refund claim.

A qualifying purchaser includes the following:

• foreign entity
• foreign diplomat
• non-resident of South Africa
• tourist
• international organisation
• organisation which is like an association not for gain or welfare organisation

Other criteria that must be fulfilled for the refund to be considered:

• the products must be exported within 90 days of the date on the tax invoice.
• the refund request, including the necessary documentation, is to be received by the VAT Refund Agency (VRA) within 90 days of the date of export.

VRA offices are situated at Cape Town, King Shaka, or Johannesburg International Airports, or designated ports and land border posts.

• all required original documentation proving that the products were exported by rail, air, road or sea to be submitted.

If a tourist, you must declare the items to a customs official. The original documents, as well as the products, must be presented.

• Must have a valid Tax invoice with a minimum total value (including VAT) of ZAR 250 per entity for items purchased.
• the products must be exported through any of the 43 commercial ports designated for this service.

What documentation is required:

• original passport with entry stamp
• original tax invoice/s, which must include the following details:
  • vendor’s name, address, and VAT registration number
  • unique serialised tax invoice number and date of issue
  • accurate description of items (including whether these are second-hand)
  • value of the item and VAT charged on the item
  • include the words “Invoice”, “Tax Invoice” or “VAT Invoice”
  • where the invoice exceeds ZAR 5000 including VAT:
    • claimant/purchaser’s name and address (and VAT registration number, if you are a VAT vendor)
    • state the quantity or volume of products supplied

Simple step-by-step guide on how to claim your VAT refund:

1. Request a tax invoice for all purchases.

(If a tourist, it is as simple as informing the shop attendant when buying an item that you are a foreign tourist and then asking for a tax invoice).

2. Ensure you have all the necessary documentation on hand.

3. Present your goods for inspection and endorsement by a South African customs agent, VRA agent or both at international airports or other commercial ports.

(Should you be unable to do so, you are obligated to provide further documentation. This would include an original “export declaration form”, which will need the signature and endorsement of a Customs official from your home country on your arrival there).

4. Submit all documents either in person or via post. Your choice of which claim route to take will depend on your circumstances.

Submitting by Post:

In this case, you will need to download the Postal VAT refund application form and fill it out. You will also need to include the original tax invoices and a certified copy of your passport. Once you have completed the form and gathered all the necessary documents, you can mail them to the VRA office. The officials will verify your documents and eligibility for the refund and once approved, you will receive your refund through a bank transfer if the amount is less than R3000 you will receive the amount within 3 to 4 weeks, if the amount is larger than R3000 it may take up to 90 days.

In summary, a qualifying purchaser may claim a refund of VAT paid on the acquisition of goods by submitting a VAT refund claim to the VAT Refund Agency (the VRA).

Should you have questions regarding South African import or export regulations, contact our office on 087 550 1038. One of our consultants will be happy to help you.
 

Note: For South African individuals and businesses exporting from South Africa, your VAT implications are here.